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How much can I sell per year without adding it to my income

 
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JefferysJunction



Posts: 471

PostPosted: Mon Feb 19, 2024 3:02 pm    Post subject: How much can I sell per year without adding it to my income Reply with quote

How much can I sell per year without adding it to my income taxes?

I live in Minnesota, if that matters.
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lastade-designs
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Posts: 2904

PostPosted: Mon Feb 19, 2024 4:23 pm    Post subject: Reply with quote

Any amount of money you earn by selling you are supposed to declare on your income taxes forms. But the good news is you can write off many things to offset the gross amount. You only pay a tax on the net amount after you write off your expenses, Expenses can be office supplies, Paypal fees, Marketplace fees, car milage, a percentage of your internet bill, and mailing costs. You may be eligible for more. A good small business accountant will help you if you do not know what to do.

If you have kept track of your income and expenses you could probably use one of the online tax preparers. I used EZtax.
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JefferysJunction



Posts: 471

PostPosted: Mon Feb 19, 2024 5:03 pm    Post subject: Reply with quote

In Florida, only business income over 20K has to be added to income taxes. But I wonder what the limit is in Minnesota. Ecrater has not sent be a tax statement.
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lastade-designs
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PostPosted: Tue Feb 20, 2024 1:22 am    Post subject: Reply with quote

The 20,000 is just a threshold for you to receive a 1099-k form. In some states the threshold is lower. For Ecrater income, Paypal and Stripe will send you the form or you will print it out electronically, if you reach the threshold. If you don't reach the threshold you won't receive one. But if you still earned income from a small business you should be paying income tax, and self-employment tax. One good reason is that it will make a difference in your Social Security check when you reach the retirement age.

This article may be helpful
https://www.1040.com/blog/2019/7/12/selling-stuff-online-taxes-for-etsy-ebay-letgo-and-more/
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JefferysJunction



Posts: 471

PostPosted: Tue Feb 20, 2024 7:19 am    Post subject: Reply with quote

I understand that the threshold for receiving a form 1099-k is different in every state. That's why I am asking. I am trying to find out what the threshold is in Minnesota.
I'm sure we have some other sellers from Minnesota in this ecrater forum.
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SheilaDeesPostcards
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Posts: 4620

PostPosted: Tue Feb 20, 2024 8:50 am    Post subject: Reply with quote

According to Stripe information, ( https://docs.stripe.com/connect/1099-K ), the state of Minnesota has the same 1099-K threshold as the IRS. As of the end of 2023, the IRS extended the older threshold of $20,000 and 200 transactions. However the IRS is looking at lowering the threshold to $5000 for 2024.

So, unless you process $20,000 through a payment processor in 2023, you won't get a 1099-K from that payment processor.

However, if you had ANY profit from online sales in 2023, you must report that income on your Federal Income Tax either as business profit or Capital Gains (for personal items). You also need to be aware of the rules related to income for your state. Here in Florida, we don't have an income tax unless you are a corporation.
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SheilaDeesPostcards
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Posts: 4620

PostPosted: Tue Feb 20, 2024 9:06 am    Post subject: Reply with quote

JefferysJunction wrote:
In Florida, only business income over 20K has to be added to income taxes. But I wonder what the limit is in Minnesota. Ecrater has not sent be a tax statement.
The 1099-K is sent by the electronic payment processors. When you sell on eCRATER you have the option of offering either PayPal and/or Stripe. The buyer's money is never handled by eCRATER. If you received a 1099-K for your eCRATER sales, it would come from either PayPal or Stripe or, if you had great sales, maybe one from both of them.

It's also important to note that the $ amount processed through a payment processor would include ALL the payments you processed through that processor from ALL sources. In other words, if you had eCRATER sales, other online market sales, your own website sales, point of purchase sales at a flea market/festival, etc that you processed the payments through your PayPal account, they would all be totaled to see if your PayPal account reached the yearly threshold for a 1099-K.
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